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Offshoring and Firm Performance: Evidence from French Manufacturing Industry

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  • Liza Jabbour

Abstract

Abstract This paper examines the implications of offshoring by French manufacturing firms on their productivity and profitability. Offshoring is considered as endogenous and its impact is estimated on ex post measures of firm performance. The dataset used allows the distinction between two forms of offshoring: vertical foreign direct investment (FDI) and international outsourcing. It also gives us the possibility of distinguishing between offshoring to developed and developing countries. The results show, first, that offshoring has a stronger effect on profitability and, second, that the implications on performance are significant only in the case of international outsourcing to developing countries. Copyright 2010 Blackwell Publishing Ltd.

Suggested Citation

  • Liza Jabbour, 2010. "Offshoring and Firm Performance: Evidence from French Manufacturing Industry," The World Economy, Wiley Blackwell, vol. 33(3), pages 507-524, March.
  • Handle: RePEc:bla:worlde:v:33:y:2010:i:3:p:507-524
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    10. Liza Jabbour, "undated". "Market Thickness, Sunk Entry Costs, Firm Heterogeneity and the Outsourcing Decision: Empirical Evidence of Manufacturing Firms in France," Discussion Papers 08/20, University of Nottingham, GEP.
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    Cited by:

    1. Neil Foster-McGregor & Anders Isaksson & Florian Kaulich, 2016. "Importing, Productivity and Absorptive Capacity in Sub-Saharan African Manufacturing and Services Firms," Open Economies Review, Springer, vol. 27(1), pages 87-117, February.
    2. Nicole Litzel & Joachim Möller, 2011. "Industrial Clusters and Economic Integration: Theoretic Concepts and an Application to the European Metropolitan Region Nuremberg," Chapters,in: International Handbook on the Economics of Integration, Volume II, chapter 12 Edward Elgar Publishing.
    3. Andrea F. Presbitero & Matteo G. Richiardi & Alessia A. Amighini, 2015. "Is labor flexibility a substitute to offshoring? Evidence from Italian manufacturing," International Economics, CEPII research center, issue 142, pages 81-93.
    4. Alessia Lo Turco & Daniela Maggioni, 2013. "On the Role of Imports in Enhancing Manufacturing Exports," The World Economy, Wiley Blackwell, vol. 36(1), pages 93-120, January.
    5. Alicia Rodríguez & María Jesús Nieto, 2016. "Does R&D offshoring lead to SME growth? Different governance modes and the mediating role of innovation," Strategic Management Journal, Wiley Blackwell, vol. 37(8), pages 1734-1753, August.
    6. da Silveira, Giovani J.C., 2014. "An empirical analysis of manufacturing competitive factors and offshoring," International Journal of Production Economics, Elsevier, vol. 150(C), pages 163-173.
    7. João Amador & Sónia Cabral, 2014. "Global Value Chains: Surveying Drivers, Measures and Impacts," Working Papers w201403, Banco de Portugal, Economics and Research Department.
    8. Ohnemus, Jörg, 2009. "Productivity effects of business process outsourcing: a firm-level investigation based on panel data," ZEW Discussion Papers 09-088, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    9. International Monetary Fund, 2014. "France; Selected Issues," IMF Staff Country Reports 14/183, International Monetary Fund.
    10. Giuliano Conti & Alessia Lo Turco & Daniela Maggioni, 2014. "Rethinking the import-productivity nexus for Italian manufacturing," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 41(4), pages 589-617, November.
    11. repec:eee:proeco:v:199:y:2018:i:c:p:199-208 is not listed on IDEAS
    12. Bernhard Dachs & Bernd Ebersberger & Steffen Kinkel & Oliver Som, 2015. "The effects of production offshoring on R&D and innovation in the home country," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 42(1), pages 9-31, March.
    13. Neil Foster-McGregor & Anders Isaksson & Florian Kaulich, 2016. "Importing, Productivity and Absorptive Capacity in Sub-Saharan African Manufacturing and Services Firms," Open Economies Review, Springer, vol. 27(1), pages 87-117, February.
    14. Joachim Wagner, 2011. "Offshoring and firm performance: self-selection, effects on performance, or both?," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 147(2), pages 217-247, June.
    15. Martin Borowiecki & Bernhard Dachs & Doris Hanzl-Weiss & Steffen Kinkel & Johannes Pöschl & Magdolna Sass & Thomas Christian Schmall & Robert Stehrer & Andrea Szalavetz, 2012. "Global Value Chains and the EU Industry," wiiw Research Reports 383, The Vienna Institute for International Economic Studies, wiiw.
    16. Yi-Ju Lo & Tung Hung, 2015. "Structure offshoring and returns on offshoring," Asia Pacific Journal of Management, Springer, vol. 32(2), pages 443-479, June.
    17. Roger Bandick, 2016. "Offshoring, Plant Survival and Employment Growth," The World Economy, Wiley Blackwell, vol. 39(5), pages 597-620, May.
    18. Angels Pelegrín & José García-Quevedo, 2012. "Which firms are involved in foreign vertical integration?," Working Papers 2012/38, Institut d'Economia de Barcelona (IEB).

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